Biden Administration Seeks $101M Aid for Pakistan
The Biden administration seeks $101 million in aid for Pakistan to combat terrorism, support economic reforms, and provide debt relief, according to US Assistant Secretary Donald Lu.
Donald Lu, the US Assistant Secretary for South and Central Asia, announced on Tuesday that President Joe Biden has requested $101 million in aid for Pakistan to support democracy and human rights. Speaking before a committee of the American House of Representatives convened to discuss the US budget for South Asia, Lu stated that the funds would be used to combat terrorism, support economic reforms, and provide debt relief.
Lu, who was accused by Pakistan Tehreek-e-Insaf (PTI) founder Imran Khan of toppling his government in 2022, emphasized that this financial assistance aims to stabilize Pakistan’s struggling economy. Despite securing a 37-month-long International Monetary Fund (IMF) program, Pakistan’s economy remains in dire straits.
The staff-level agreement for the IMF program, initiated in May, followed the completion of a short-term $3 billion program that helped stabilize the economy, avoid a sovereign debt default, and set challenging revenue targets in its budget to gain IMF approval. The new agreement introduces increased taxes on agricultural incomes to boost government revenue and reduce the recurrent deficit, crucial for obtaining the lender’s approval. The highest effective tax rate is set to rise to 45% from the current 15%, starting in 2025, a move described as “unprecedented” by brokerage and investment banking firm JS Global.
Lu also expressed concerns about the situation of women and minority groups in Afghanistan, asserting that relations with the Taliban government cannot normalize until Afghan citizens’ rights are respected. He demanded the release of all American prisoners held by the Afghan Taliban.
The US continues to be the largest aid donor to Afghanistan, providing more than $17.9 billion in assistance since the Taliban took control of Kabul nearly three years ago. This support has persisted despite the chaotic US troop withdrawal on August 30, 2021, following 20 years of conflict with the Islamist militants.
